I am trying to install a Friendia server, and getting the following error "Url rewrite in .htaccess is not working. Check your server configuration."
Is this an issue with Nginx, and if so, how can I configure things to work?
Nginx doesn't support .htaccess files. You will need to either convert its rewrite rules to nginx syntax, or switch your VPS back to Apache.
There's an up-to-date sample nginx config in the mods directory of the package